SHTA Calls for Immediate Revocation of New Permit Policy

The Sint Maarten Hospitality and
Trade Association (SHTA) calls for an immediate revocation of the new “Policy
on issuance of Labor Permits, as was published last Friday February 7th in
the National Gazette.

The policy change is meant to
decrease unemployment and underemployment of residents. SHTA fully aligns with
the Ministry on this ambition, but stands vehemently against the
policy. The SHTA’S objections to the change in policy are supported by The
Sint Maarten Timeshare Association (SMTA), the Sint Maarten Marine Trades
Association (SMMTA) and the Indian Merchants Association (IMA) in this protest.

The association stresses it will only
exacerbate the challenges of the still ailing economy. It calls
for government to first consult with one of the many advisory bodies
established for such purposes and the private sector associations before
issuing a decree of this extent. All would have directly pointed to the
many adverse effects of this new policy. It reminds the Minister that it has
the Social Economic Council (SER) and the Ministry of VSA’s own Tripartite Committee
to consult on matters with great impact like Friday’s decree.

The policy seeks to establish a
“National Employment Service Center” that will provide candidates; sit in on
job interviews with the candidates, and possibly compel employers to discuss
reasons for rejecting a candidate. An arbitrary decision is then made on the
granting of a work permit for foreign labor.

With the new policy, government seems
to sit in the chair of the employer/investor and run their HR department,
without bearing any risk or responsibility, and intruding in the privacy of
application talks. As per the policy, government can repeat this process if the
result is not to their liking, with seemingly unending iterations. Besides not
providing a clear route to a work permit, this new process puts an
extremely long lead time in employer’s hiring decisions when swift action may
be needed to sustain the employer’s operations, and also leaves room for
graft.

No distinction is made regarding
skills or education levels, nor are policy details on the length of the added
process shared. There is no guarantee that the participant member of the
National Employment Service Center would even have the knowledge to evaluate
whether a person is qualified for some of the jobs that normally require
foreign labor, let alone have a reasonable understanding of the
company’s needs and culture for which it is interviewing.

SHTA warns that among other things
the rigidity in our labor market is pointed to repeatedly as a hindrance to
growth in Sint Maarten economic reports by every international monitoring
body. It is also a point SHTA has been stressing since well before Irma
as a cause of the lack of economic growth and the restriction of upward
mobility amongst our labor force. (shta.com/vision-2025). Instead of easing restrictions, the new policy brings
additional rigidity, cost, time and bureaucracy into the process.

The policy creates additional
impediments for a private sector that has not received any assistance for
recovery, unlike the wake of hurricanes Luis and Lenny; where the recovery of
the private sector and thus the job market was paramount within the
process. This policy will cause employers to hire less and investors to invest
less, resulting in a net loss of jobs. Reduction of Foreign Direct Investments
(FDI) will be another indirect effect.

Next to an economic impact, a
societal one will occur. As per the Ministry’s own numbers, 7% of last year’s
permits were issued to Teachers and Nurses; 2 job categories that are in global
shortage, and long known to be insufficiently available on Sint Maarten. For an
overburdened educational and care system, the new policy will make it more
difficult to hire qualified and experienced personnel, bringing the quality of
education and care down with it.

Just as interesting, most work
permits granted last year (25%) were for the adult entertainment sector. SHTA
would like to know if this industry is going to be forced to follow the same
new labor rules keeping a list of locals qualified for the job, and having a
government employee sitting in on the interviews. In addition, SHTA wonders if
this policy applies for government when it lacks specific expertise.

The government’s decision to further
restrict the labor market is against every international advice received to
stimulate the economy and increase jobs. In 2019, 12% of the permits were
granted to the construction sector; just under 5% were issued in the
hospitality sector, hospitality being the largest industry on St.
Maarten. This is a miniscule number compared to the number of jobs the
Hospitality sector creates; and are usually reserved for specific functions or
senior positions. Both sectors are likely to suffer from the impact of this
policy.

Last but not least the policy will
form an additional burden for an overburdened and financially insecure
government, and will remain without achieving the desired effect. SHTA refers
to earlier, more effective initiatives by the Labor Office in reaching the
target of reducing unemployment, and suggests to restart those while
revoking this policy directly. Most importantly, it asks government to involve
all stakeholders involved before implementing such widely impactful decisions to
avoid further economic damage during the frail recovery process.